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Boeing is suffering more than two years delay in launching its new composite-material 787 airliner and order cancellations are coming in. The reasons are interesting. First, Boeing has not only severely forfeited the product development capability it has always shown (e.g. in the 777 program) by shifting its attention and top management culture from engineering to sales. Second, it has inappropriately increased the degree of outsourcing, given the type of innovation involved. Using composite materials instead of alluminum for the airframe clearly is a radical innovation. Given that airplanes have an integral architecture, Boeing should have just done the opposite and developed competencies internally.

Outsourcing has succeeded because of its ability to industrialize business activities - reduce risk, drive standardization, increase productivity, and improve predictability.

A brief editorial comment on the problem of conflicts of interest that emerge between companies that sponsor academic research and the recipients of such grants. Of course, when the field is pharmaceuticals, the problems become very big.

In the past decades, most watchmakers have decided to source core parts from suppliers. This has led to the quasi-monopoly of the component manufacturer ETA, owned by the Swatch group. Now this strategy is backfiring, with ETA creating stricter conditions to its customers, the latter complaining about unfair business practices but fundamentally unable to find alternative strategies. As one executives states, "it's not ETA that has created a monopoly, but others, by not investing".